Study Challenges Idea of Hybrid Auto Buyers
Unlike classic technology “early adopters,” people who purchased Prius automobiles did not feel that they paid a premium for the privilege of owning an environmentally friendly car.
While the environmental benefits were a major consideration for them, they also saw clear financial benefits from their purchase, says a new study by the Topline Strategy Group, a leading technology consulting and market intelligence firm.
The study, “Why People Really Buy Hybrids,” studied Prius buyers to understand the true motivations of people who buy hybrid cars and thereby discern the hybrid industry’s future prospects in light of recently falling sales.
The study surveyed people who bought Prius automobiles between 2003 and 2007. It divides hybrid buyers into five purchasing segments and identified that for 73 percent of purchasers, there were clear financial rewards for purchasing a hybrid over other alternatives.
For forty percent, the Prius cost less than the traditional Acura, BMW, or another more expensive car they would have otherwise purchased. Sixteen percent of buyers drove enough miles or planned to own the car long enough for gas savings to pay back the initial cost difference. Twelve percent bought the Prius so that they could save time by driving alone in the carpool lane—which is allowed in six states—and five percent bought the car as an inexpensive “fun” car.
The study concluded that the economic case for hybrid purchases is stronger than typically discussed, and that the hybrid market has expanded to include more buyers than just early adopters willing to pay a premium for being the first to own a Prius or because of environmental concerns. It also concluded that with attractive financial incentives already in place, the 2006 and early 2007 slowdown in hybrid sales growth represents a temporary lull, and growth is projected to accelerate again soon, regardless of short-term fluctuations in gas prices.
“Only 27 percent of Prius buyers could be considered classic early adopters,” said Jonathan Klein, founder and general partner of Topline Strategy Group. “The Prius has been successful because it represents a low-cost, stylish, practical car with a strong environmental image—a combination of attributes that tapped into a broad market of environmentally conscious people who saw it as an opportunity to do the right thing, save money, and buy an appealing car all at the same time.”
The study was conducted between February and March 2007 among 118 respondents. Additional information can be found at www.toplinestrategy.com.
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