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Toyota cuts price of Prius Hybrid plug-in to spur demand
Toyota has become the latest automaker to try to use price cuts to spur demand for its struggling battery-based products, trimming as much as $4,620 off the suggested retail price of the plug-in version of its Prius Hybrid.
Virtually every automaker marketing advanced battery vehicles, including Ford, General Motors, Honda and Nissan, has been forced to trim prices this year as sales of plug-ins, extended-range electric vehicles and pure battery-electric vehicles, or BEVs, have lagged well below expectations.
For 2014, the base version of the Toyota Prius Plug-in will start at just $29,990 – plus delivery fees – a discount of $2,000. Unlike the new base model of the Nissan Leaf battery-electric sedan, Toyota says the price cut “is not accompanied by any reduction in vehicle content.” In fact, it has added such content as automatic climate control.
Meanwhile, the Japanese automaker will trim the price on the 2014 Prius Plug-in Advanced model to $34,905, a reduction of $4,620. The Advanced version comes with additional features such as a Head-Up display, or HUD, 8-way power driver’s seat, an advanced navigation system and heated front seats.
Battery car sales, in general, have been struggling in recent months, after some gains earlier in the year. According to data from Ward’s, demand plunged 27 percent in September -- with virtually all models taking a hit – a drop significantly worse than the overall dip in U.S. car sales for the month.
Among the hardest hit was the Chevrolet Volt, off 47 percent, while the Nissan Leaf fell 19 percent. Even the Tesla Model S, which had been gaining momentum in recent quarters, dropped 20 percent. As for the Toyota Prius Plug-in, it saw a 30.3 percent drop in demand, year-over-year.
The overall U.S. market dipped last month, though many analysts downplayed the slide as, for the large part, the result of peculiarities in the way sales are reported. The entire bump from annual Labor Day sales, for example, were combined into August. But battery car demand may have also been hurt as gas prices began sliding. By comparison, pickup truck sales have been gaining momentum all year.
The Prius Plug-in has its own issues, industry analysts note. Prior to the current cut in price, the extended-range model carried a more than $5,000 premium over the comparably equipped Prius Three version of the original Toyota hatchback.
For that added money, buyers got a modest 11 miles of battery-only range, or less than a third as much as a Chevy Volt. That meant relatively few users could complete their entire commute, even one way, on battery power alone. And because of its smaller battery pack, the Prius Plug-in only qualified for a $2,500 federal tax credit compared to $7,500 for the Volt, $4,007 for the Ford C-Max Energi and Fusion Energi plug-ins, and $3,626 for the Honda Accord Plug-in.
Critics have taken shots at a number of those and other battery models – though particularly at the Prius Plug-in – dubbing them “compliance cars” produced solely to meet the minimum standard set by California’s Zero-Emissions Vehicle law.
On the plus side, the Prius Plug-in still allowed buyers to apply for California’s coveted HOV sticker allowing access to faster freeway commuter lanes even with a single person on board.
Whether the price cuts will help revive sales of the Toyota model remains to be seen. Similar reductions have had mixed results elsewhere in the nascent battery-car market.