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Toyota dealers pass on electric cars, prefer hybrids

A recent survey from AutoRetailNet shows that 85 percent of Toyota dealers say the automaker was correct to kill production plans for its electric car, Gordon-Bloomfield writes.

By Nikki Gordon-BloomfieldGuest blogger / October 16, 2012

The Toyota logo is seen on the bonnet of a Toyota Avensis outside Germany's headquarters of Japan's Toyota Motor Corp in Cologne in this October 2012 file photo. According to a new survey, only 5 percent of Toyota dealers say they believe all-electric cars would be the best-selling electric car technology in five years’ time, Gordon-Bloomfield writes.

Wolfgang Rattay/Reuters/File

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Thanks to its ever-expanding range of hybrids, including the well-known Prius liftback, Toyota Toyota dealers have a wide range of green cars to sell. 

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You may think that would make them more receptive to selling all-electric cars, but a recent survey from AutoRetailNet (via plugincars) suggests otherwise.

In fact, the online publication for dealers reports, 85 percent of Toyota dealers say the automaker was correct to kill production plans for its electric Scion iQ city car just a week before it was due to debut at the 2012 Paris Auto Show.

At the time, Toyota had justified the decision by telling Reuters that electric cars “do not meet society’s needs.” 

For now, most Toyota dealers agree, with only 5 percent saying they believed all-electric cars would be the best-selling electric car technology in five years’ time. 

The majority, a massive 70 percent, said they believed regular hybrid cars would occupy that slot, while 10 percent said plug-in hybrids would be number one. 

Even though Toyota isn’t due to release its first production fuel cell car until 2015, 15 percent of dealers said hydrogen fuel-cell cars would sell in greater numbers than battery electrics.

The reasons for this disinterest in electric cars seem wide and varied. On average, it takes a dealer a lot longer to sell an electric car than it does a gasoline car. 

In addition, the profit margins tend to be smaller, meaning less income for the dealer.

As a consequence, the job of selling plug-in cars may pass to junior salespeople, many of whom are just as keen to prove themselves with high-profit sales as their peers, but lack the experience and knowledge required to sell a plug-in car.

With the exception of a handful of Toyota dealers in California now selling the 2012 RAV4 EV electric crossover SUV, most Toyota dealers do not have a battery electric car to sell--and don't appear to have much interest in getting one.

They’d much rather sell a hybrid car, although for some, governmental pressure to sell high-mileage cars is unwelcome.

“The government is pushing CAFE regulations too hard and not allowing consumers to spend their own money,” one dealer in Arizona said in the survey. “Most customers will not spend an additional $6,500 to get a 20 percent increase in fuel [economy].”

This line of thought echoes the long-held position of the National Auto Dealers Association (NADA) trade group, which has been uniformly and consistentlyopposed to the higher 2017-2025 fuel-economy standards proposed by the EPA and NHTSA, and agreed to by most major automakers.

At dealerships where the attitudes toward electric and plug-in cars are positive, plug-in cars enjoy similarly positive sales figures. At dealerships where there’s an ambivalence toward plug-in vehicles, they can languish on the dealer lot for weeks. 

There’s clearly a lot of dealer prejudice against plug-in cars, but how should automakers, dealerships, and consumers solve it? 

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