Technology · August 5, 2022

Plug-in hybrid cars are gaining ground in the race with electric competitors

In late 2010, General Motors attempted to push Toyota’s successful Prius hybrid to the top with the Volt plug-in hybrid – a car that could run on electricity only for short journeys and fire up a petrol engine for long journeys.

But the Volt and other similar cars have struggled to win over drivers, with many early adopters opting for all-electric cars like Tesla’s Model S and the Nissan Leaf. GM quietly scrapped the Volt in 2019 when it was targeting all-electric cars.

But something funny happened on the road to obsolescence: sales of plug-in hybrids are soaring in the United States, in part because of recent increases in gasoline prices. According to Wards Intelligence, automakers sold a record 176,000 such cars last year, up from 69,000 in 2020. This year, plug-in hybrid sales could reach 180,000, analysts said, although the total new-car market is at 14.4 million plummets 15.3 million a year earlier, according to Cox Automotive.

All-electric cars have captured around 5 percent of the new car market, and most analysts and industry executives expect they will eventually surpass hybrids as automakers commit to eliminating tailpipe emissions, which are a major contributor to climate change. But hybrids — led by a growing selection of plug-ins — still make up about 7 percent of sales, and that number could be rising for at least a couple of years.

Automakers are struggling to ramp up EV production because the battery supply isn’t growing fast enough. This is one of the reasons why the average cost of a new electric car is now a whopping $66,000. This offers an opening for plug-in hybrids.

In contrast to conventional hybrids, which can only be fueled with petrol and are dependent on motors, plug-in variants can be fully battery-powered. And because these cars have smaller batteries than pure electric vehicles, they can be cheaper. The cars also convince that they do not have to be plugged in for many hours to be fully charged. On road trips, they can be fueled with petrol, removing the range anxiety that keeps many people from buying electric cars.

“I think some automakers, including GM, have pushed PHEV aside far too quickly in the face of all-electric vehicles,” said Karl Brauer, executive director of research at iSeeCars.com, an auto research firm. “And I wonder if they regret that decision given the supply chain issues and price hikes we’re seeing now.”

Mr. Bauer and others also note that many car buyers are reluctant to buy electric vehicles. A JD Power survey found that one of the top reasons people aren’t buying one is that there aren’t enough public charging stations in the United States. And charging an electric car at public stations for around 30 to 60 minutes – a typical fare for even the fastest chargers – or at home overnight is an inconvenience many motorists don’t want to put up with.

Plug-in hybrids were conceived as a transitional technology that would bring people closer to the benefits of electric driving while allaying their concerns about the technology. But when gas was about $3 a gallon, the savings these cars offered didn’t always add up.

Now that gas tanks can cost $100 or more, some people are giving these cars a second look. It helps that buyers of some top models, like the Toyota RAV4 Prime, Jeep Wrangler 4xe, BMW 330e and Hyundai Santa Fe Plug-in, can claim up to $7,500 in state income tax credit.

The Wrangler 4xe has become a surprise hit and America’s favorite plug-in hybrid, nearly doubling its first-half year-over-year sales to more than 19,000. The RAV4 Prime is so popular that dealers can’t stock it and buyers have to wait months for one, said Michelle Krebs, executive analyst at Cox Automotive.

Starting at $41,515, the RAV4 Prime officially travels 42 miles on electric power alone. Keep driving and the Prime drives like a familiar Toyota hybrid, with more oomph: The Prime is the fastest and most powerful RAV4, with three electric motors and 302 hp. In gas-electric hybrid mode, it slurps fuel at 38 miles per gallon. With a total range of around 600 miles, it can travel twice as far as many electric vehicles before needing to refuel.

The average American drives 29 miles a day, which the Prime can easily handle on electric power alone. Over a week of daily charges – the Prime’s battery can be recharged in about two and a half hours using a home charger – the car can go more than 280 miles without using a thimble of petrol, which translates to 94mpg. The typical new car gets 27 mpg

Some owners of plug-in hybrids like the Chrysler Pacifica minivan, launched in 2017, claim to have gone many weeks without visiting a gas station. According to the Department of Energy, charging a RAV4 Prime costs about $1.07 for a 25-mile trip.

However, critics of plug-in hybrids argue that these numbers and calculations are based on the assumption that owners will plug them in regularly and take full advantage of the environmental benefits of their electric motors and batteries. Some plug-in hybrid owners may never or rarely charge their cars and use them like a gas-powered vehicle. Plug-in hybrids used in this way usually achieve mediocre fuel consumption and do little to reduce greenhouse gas emissions.

According to a study released in June by the International Council on Clean Transportation, a non-profit research organization, plug-in hybrid cars in Europe are driven purely electrically between 45 and 49 percent of the time.

Some plug-in hybrids can only go about 20 miles on electric power before needing to start the petrol engine. Skeptical engineers and analysts see unnecessary complexity in marrying two forms of propulsion in one vehicle for such meager profits.

Some auto execs, including at GM, have argued that it’s not worth investing in plug-in hybrids because it’s imperative to work on cars that don’t have tailpipe emissions. GM wants to sell only zero-emission vehicles by 2035.

Tim Grewe, director of electrification at GM, said that as electric vehicles improve and charging infrastructure expands, plug-in hybrids will become obsolete.

“EVs are just better,” said Mr. Grewe. “Battery technology has come so far that you no longer need the range-extending motor.”

European countries, which are more advanced in the transition to electric cars than the United States, are also encouraging people to drive fully electric. Partly as a result, sales of plug-in hybrid vehicles in Europe fell 12.5 percent year-on-year in the second quarter, while purchases of pure electric vehicles rose 11.1 percent.

Nevertheless, many car manufacturers such as Toyota, Mercedes-Benz, Porsche and Jaguar Land Rover continue to introduce new plug-in hybrids. These companies argue that it could be a decade or more before electric cars are affordable and convenient enough for most people.

Some luxury automakers say they have developed an improved generation of plug-in hybrids to fill the gap in fully electric car development. These cars, executives argue, will lure more buyers into the electric age because they’re almost as convenient to operate as petrol models while being more fun and more powerful.

The $104,900 Range Rover plug-in oozes London boutique luxury and 443 horsepower. It can travel 48 miles on electricity alone. The BMW 330e sedan has a button called Xtraboost that, when pressed, sends 40-horsepower electric bursts of goose acceleration, similar to nitrous bursts in “Fast and Furious” movies. The 330e retails for $43,495, on par with standard versions of the same car, even before tax credits.

Even supercar makers like Ferrari and McLaren have embraced plug-in hybrids to squeeze the last Dionysian drops out of internal combustion engines. Ferrari has said its 818-horsepower 296 GTB plug-in hybrid, which starts at $323,000, is faster on its benchmark test track than any V-8 model it’s produced.

Aside from those eye-catching models, plug-in hybrids are playing an important role, some analysts said, by getting more people into electric cars sooner than would be the case if the industry relied solely on all-electric vehicles. Mr. Brauer of iSeeCars.com points out that nine out of ten car buyers in the United States still buy a traditional car.

“If a PHEV can also serve as a pure electric vehicle at times and still uses less fuel as a hybrid than a conventional vehicle,” he said, “that’s still a huge CO2 reduction at a price that makes it more viable for consumers.”