Eco-friendly Lexus cars in demand despite shrinking market, downturn SALES of premium hybrid cars are rising but it's not because of sky high pump prices.
Rather, buyers of upmarket Lexus petrol-electric hybrids like the prodigious power that these models pack, says authorised distributor Borneo Motors Singapore.
In the first four months of 2009, Borneo's Lexus division sold a total of 87 hybrid cars, compared with 65 units in same period a year ago - a 33.8 per cent increase.
Helping to boost numbers is the arrival of a new hybrid model, the GS450h sedan, in November last year.
So in spite of the current economic downturn and the fact that this year's passenger car market will shrink by at least 24 per cent because of the smaller COE quota, sales of Lexus hybrids are stronger.
In addition to the GS450h, Lexus offers two other hybrid models - the RX450h sport-utility vehicle and the top-of-the-line LS600h limousine.
There are also two other hybrid cars in the Singapore market - the Toyota Prius and the Honda Civic Hybrid.
All hybrids have a petrol engine under the hood, along with one or two electric motors and a high-voltage battery.
The car's kinetic energy, which is otherwise wasted when braking or decelerating, is recovered and converted into electrical energy.
This electrical assistance helps to reduce fuel consumption and greenhouse gas emissions, thus making hybrids appear more eco-friendly.
But while the Prius and Civic Hybrid are focused on maximising fuel savings, Lexus hybrid models use the extra electric power to achieve outright performance.
For some Lexus customers, it is the hybrid's massive power with fuel economy that is the main appeal.
"After customers have test driven the car, they realise that it is very powerful," said William Choo, commercial director of Borneo's Lexus division.
He said interest in hybrid cars started picking up when crude oil prices peaked at close to US$150 a barrel nearly a year ago.
"Many car buyers began paying more attention to fuel consumption," said Mr Choo.
"Together with greater concern for environmental protection and our continuing efforts to educate the public on the features of the Lexus Hybrid Drive System, we began to see more customers asking for hybrid cars."
But he said there were a few misconceptions initially.
"Some had the impression that a Lexus hybrid needed a power socket to charge the battery and that it does not have enough power," he said.
These were dispelled after a test drive and Mr Choo said potential customers understood that the Lexus hybrid is also "an intelligent car".
"The GS hybrid has 339 hp and does zero to 100 kmh in 5.9 seconds. It will intelligently switch between battery and gasoline engine or use both, depending on the driving conditions," he said.
With the robust demand, Mr Choo said Borneo Motors is targeting hybrid models to make up "at least 30 per cent of our overall Lexus volume this year".
By contrast, the Japanese premium marque says only 10 per cent of all Lexus models sold globally are hybrids.
Demand is healthy even though hybrid models usually cost more than conventional Lexus models.
For example, the RX450 starts from $188,000 after the Green Vehicle Rebate.
This means that the RX450h, which was launched in mid-May, carries a $12,000 premium over the non-hybrid RX350.
Mr Choo said: "Customers do not mind paying the $17,000 premium for a GS hybrid because they recognise that it gives them the luxury, comfort, performance and the fuel economy while at the same time, protecting the environment."
But at the other end of the price spectrum, hybrid sales seem to be affected by the relatively low pump prices.
The Honda Civic Hybrid, for example, is seeing tapering sales.
Priced at $85,300 (with COE), it costs more than a conventional Civic sedan and hence is considered "expensive".
As a result, authorised Honda distributor Kah Motor's year-to-date sales of the Civic Hybrid have slipped 80 per cent.
From January to April 2009, only 42 such cars were registered, compared with 218 units in the corresponding period in 2008.
This article was first published in The Business Times.
