Keep in mind that there is a six cylinder premium relative to the 4 cylinder. The 2006 Altima V6 costs approximately $3000 more then the 4 cylinder with the SE package. The point is, people seem to be willing to pay $3000 more for the extra power. I didn't check the package difference between the 4 and 6 cylinder versions, but since the 4 cylinder comes with the SE package, I'll assume they are fairly close as far as accessories are concerned.

The Hybrid version is the 4 cylinder with the hybrid components, so lets assume it will cost $4000 more then the standard 4 cylinder version. That is only $1000 more then the V6 version. Of course, I'm just guessing about the pricing of the hybrid version. I think if manufacturers can get the cost of the hybrid with 1-2K of the 6 cylinder, people would be enticed by that. Sure oil prices are down, but gee, what are the chances that the middle east will fall to pieces (nothing EVER goes wrong in the middle east).

I don't see these midsize hybrids replacing the 4 cylinder versions. Most 4 cylinders are fairly efficient to begin with, and the price premium is too high. Relative to the V6 versions of most mid size cars, the hybrids seem to make a lot of sense.

Peace,
Cosmo

Since this is Nissan's first hybrid, it will be eligible for the full credit. That's around 3 thousand dollars.

The amount of the credit varies by vehicle, dependent on emissions. Hybridcars.com pegs the estimated credit for the Altima at $1,300 and the Camry at double that. The Camry's credit is now at 50% until March 31, 2007, so it's the same as the Altima's estimated credit.

http://hybridcars.com/tax-deductions-credits.html
http://www.fueleconomy.gov/feg/tax_hybrid.shtml

I do want to know how the pricing compares to the Camry hybrid. Anybody?

Couldn't find it, but the Altima generally has an MSRP similar to the Camry, with the Camry (at least in 2006) coming in about $1,000 cheaper in terms of real prices. Ownership costs on the Camry are about 3 cents less per mile. See Edmunds.com for details.

Not to mention gas won't be $2.50/gal cheap much longer.

Right; prices that high are not sustainable. It's already well below that at most places in the US. Even at $60/barrel, the price of oil is unsustainably high, given the alternative fuel sources that are massively profitable when oil is that expensive.

Cosmo - I agree with you. I think with the ROI people are often comparing apples and oranges.

Note in the the article this car gets .5 seconds faster 0-60. That is a big difference. The Lexus 450H has stunning acceleration. So it saves money with gas, and has better performance.

Another is smoother acceleration as the electric motor assists during the dips as the ICE gears up.

And it has a price disadvantage so customrs can decide what they want ot spend their money on. I agree with you also that in the super economy 4 cylinder cars the hybrid isn't a competitive option right now.

"Even at $60/barrel, the price of oil is unsustainably high, given the alternative fuel sources that are massively profitable when oil is that expensive."

For example?

What's the ROI on that six cylinder version, over the four? How many miles until those two extra pistons start to pay for themselves? I guess they must have decent ROI, otherwise nobody would buy a six, would they?

If we ever wise up and implement a carbon tax in the US then the benefits of hybrids will make more financial sense. Improved MPG also results in lower emissions. Ergo, you drive a gas guzzling spewer, you pay a higher tax for the privledge of dumping those extra emissions .

Hal,

Great comment. The "return" on the V6 is the joy they get when they push their foot down on the gas pedel. So the return in this case might be cleaner air and less imported oil.

" Even at $60/barrel, the price of oil is unsustainably high, given the alternative fuel sources that are massively profitable when oil is that expensive."

Agreed but it will take years to ramp up enough production. In the meantime, oil could easily bounce up to $100 and higher.

Looking at the financial caluclations, why don't they launch this in Europe?

If the vehicle does 10,000 miles per year, 178 Gallons is saved. That's about 750 litres and at 90p per litre, that's abpit GPB 670, or perhaps $1,200.

There's would be another £100 or saving on Road Tax, so total savings about $1300 - 1500 per year. That should justify a premium of $7,000 over the V6 model.

About the ROI calculation,

Unfortunately, it seems that for hybrids to sell in this country, they will need to "pay for themselves" if they are to find a broad audience in the US.

It seems to me that there are three reasons to buy a hybrid: 1)Save the environment 2)Geopolitical Security 3) Save money. Lets look at all three:

1) Talk to most people, and they will say they are environmentalists, but few actually do things to improve the environment. Think about it as talking the talk vs. walking the walk. I'm willing and fortunately able to shell out a couple grand extra to buy a car that is better for the environment (Prius), but unfortunaltely, most people in this country are not willing to incur cost to do so. Hell, you should hear the conversations I have with very intelligent people trying to convince then to use compact flourescent bulbs in their house. They absolutely refuse to spend $6 on a bulb. Never mind they pay for themselves in the long run. It's absolutely madening. So for arguments sake, lets just say that the "save the environment" mantra will not compell enough americans to purchase enough hybrids to lift this type of vehicle above a niche product.

2) The "We need to ween ourselves of of foreign oil" argument seems to be gathereing some stregnth, and has become a more compelling argument for most americans since 911. I see the same hurdles relative to the environmental argument with this one as well. How many people are going to spend more money, or give up performance to make sure that the Uber-Nutjob Hugo Chavez is unable to use American dollars to fund more anti-american poiticians in Latin America? Probably very few. Most americans believe it is there god given right to use as much oil as possible without considering where that oil comes from. As with the environmental argument, the "boiled frog" phemomenon is in effect. The anti-american, fascist and Islamo-fascist forces that control large quantities of oil are slowly gathering stregnth, and I don't think most people in this country really think that American hegemony really is threatened by the non-aligned states or Islamists.

3) Save money. Fr most people, this is the strongest argument for buying a hybrid. If the typical consumer can see a vehicle that will give him/her near V6 performance AND be better for the environment AND reduce our dependence on foreign oil, only then can hybrids become more economically viable for auto execs to fund and produce.

The point is, none of us on this forum like the ROI argument. Most of us that frequent this website do so because we are interested in fixing problems 1 and/or 2. But until the majority of americans feel this way, giving them more cash in their wallet is the most effective way to sell these vehicles.

I should've been working instead of writing this,
Cosmo

Oops, under 3) in my last post,, I forgot to add:
AND save money in the log run...

Looks like I ommited my key point. My bad.

Cosmo

Cosmo, I love the ROI notion. Unfortunately, the people who often wish to bash hybrids by bringing it up usually don't the first thing about finance. Pretty much every hybrid I've ever run the numbers on pays for the hybrid premium in time, even without tax considerations. And those are straight gas savings considerations, not including issues like risk (ie, the value of being protected from rising energy prices), prestige (eg, a real estate agent whose target market is environmentally-concsious clients), HOV lane access, free parking, discounted insurance, as well as the value of feeling good about what you're doing with respect to the first two things you mentioned - the environment and energy security.

For example?

Fischer-Tropsch liquids (or syngas-derived methanol, ethanol, dimethyl ether, etc.) from natural gas or coal. These are competitive even with oil at $40/barrel, and the profit grows rapidly as oil goes beyond that. At the peak oil price, the IRR of a mine-mouth CTL plant in Wyoming was estimated to be greater than 100%/year.

Fischer-Tropsch liquids (or syngas-derived methanol, ethanol, dimethyl ether, etc.) from natural gas or coal. These are competitive even with oil at $40/barrel, and the profit grows rapidly as oil goes beyond that. At the peak oil price, the IRR of a mine-mouth CTL plant in Wyoming was estimated to be greater than 100%/year.

So, how much market share do these "wildly profitable" fuels have? At those ratesof return, it makes no sense to sell gasoline from oil.

Might want to check your numbers.

Pizmo,

You've just done a great service for me today. I completely forgot to call my insurance company and get the available hybrid 10% discount. It's been available in my state for a coulpe months now, and it totally slipped my mind. Thanks dude....

Cosmo

So, how much market share do these "wildly profitable" fuels have? At those ratesof return, it makes no sense to sell gasoline from oil.

Might want to check your numbers.

You might want to check your logic, pizmo. These plants don't spring into existence overnight; the people building them need confidence that prices will remain high enough for long enough in the future to recoup the investment. The longer oil stays high, the greater this confidence becomes. These plants are a demonstration that high oil prices cannot be sustained, since eventually they would be built and force the price down again -- if something else didn't force the price down first.

GCC has had a growing number of stories on xTL plants being discussed, planned, and moved forward on. Expect more such stories if oil prices remain high.

You might want to check your logic, pizmo. These plants don't spring into existence overnight; the people building them need confidence that prices will remain high enough for long enough in the future to recoup the investment.

Still doesn't add up - not with those kind of numbers.

"These plants don't spring into existence overnight; the people building them need confidence that prices will remain high enough for long enough in the future to recoup the investment."

Good analysis. I would guess that it will take at least ten years to replace a large percentage of the liquid fossils with bio.

At the peak oil price, the IRR of a mine-mouth CTL plant in Wyoming was estimated to be greater than 100%/year.

Care to provide a link to the detailed financials behind that number?

Hello, I think we should all be glad that there will be yet another hybrid on the road of the eight states. This would also tell something to the visitors of those eight states coming from the remaining 52 ;) Regards, --Michael

Seems like i have a math problem when it comes to counting states :) I ment to say that visitors of the eight states from the remeining forty two should come to the conclusion that maybe thir governors are not doing something for them and for their children. After all I think expecting a regular Joe to dump his V8 Suburban can either be done by $6 per gallon or by a government.

Nah, I want regular joe to keep his V8 Suburban if he wants to make that choice. But definitely have him *pay* for that choice with some heavy gas taxes ($6/gallon would be scary...but almost necessary to convince people to make a change).

I hope it doesn't cost a fortune. My Mom wants one and she doesn't have a lot of money.

It seems to me that with limited oil production and refinery capacity, sucking up twice the gas in a large SUV just to go get a bag of groceries is a problem for all of us. So, why not a gas guzzler tax when they buy them and a larger registration fee every year. If you are going to be wealthy enough to be wasteful, you should pay the price.